'Accountable' health care model holds promise

DOVER — A new health care model that rewards doctors based on the outcomes of their treatment is showing promise for cutting down costs and improving care for patients with complex health issues.

A new study by researchers at the Dartmouth Atlas Project and The Dartmouth Institute for Health Policy & Clinical Practice looked at Medicare spending among 10 health care groups operating as so-called "accountable care organizations" (ACOs).

The ACO model represents a shift away from traditional "fee-for-service" health care systems, which compensate doctors based on the volume of work they perform. ACOs offer financial incentives to doctor's offices, hospitals, and long-term care facilities to coordinate care for an individual patient, according to the U.S. Department of Health & Human Services.

The country has seen a rapid expansion in the number of organizations experimenting with ACO reimbursement models as a result of initiatives created under the Affordable Care Act in 2010. The federal health care legislation aims to cut Medicare costs by as much as $1 billion over five years by encouraging providers to coordinate care.

Hoping to study the merits of ACO models, Dartmouth researchers examined data from 10 groups taking part in Medicare's Physician Group Practice Demonstration (PGPD). PGPD was a pilot project that ran from 2005 to 2010 wherein doctors were paid bonuses for controlling spending while simultaneously providing quality care.

The Dartmouth study focused on patients who are eligible for both Medicare and Medicaid — a population that generally encompasses some of the sickest patients in the health care system.

About 20 percent of Medicare recipients have dual eligibility, but they account for about 31 percent of Medicare spending, according to the researchers.

PGPD organizations managed to cut down spending on dual eligibles by an average $532 annually, according to the study, which was published this month in The Journal of the American Medical Association. They achieved the savings largely by shortening hospital stays and reducing the number of hospital readmissions and procedures patients undergo, according to the study.

"Patients that receive both Medicare and Medicaid coverage have historically proven to be a difficult group to manage because of high illness burden, low socioeconomic status, and lack of social supports," Dr. Carrie H. Colla, lead author of the study, said in a prepared statement. "Our results suggest that while some care management or coordination programs have failed to demonstrate savings, ACOs have the potential to improve health care and reduce spending for this population."

Several organizations in New Hampshire are already working within an ACO model. Among them are a group of five participating in a project launched in 2010 by the NH Citizen's Health Initiative. They include: Exeter Health Resources, which represents Exeter Hospital and affiliated physicians; Central New Hampshire Health Partnership, based in Plymouth and Bristol; Southern New Hampshire Health System in Nashua; Cheshire Medical Center and Dartmouth Medical Clinic in Keene; and a North Country initiative of hospitals and home health groups.

Health insurance provider Cigna launched its own ACO-style project in New Hampshire in May in partnership with members of the Granite Healthcare Network, which includes Wentworth-Douglass Hospital in Dover.

Registered nurses are a crucial aspect of Cigna's program. They coordinate clinical care and help patients schedule appointments and access educational materials and clinical programs, such as disease management programs for diabetes and others to help them quit smoking, manage stress or lose weight.

The health care providers earn financial rewards if they meet targets for improving quality and lowering medical costs, according to an announcement furnished by Cigna earlier this year.

"We believe that this arrangement with Cigna offers the best opportunity for us to improve health care quality, lower medical costs and help our patients lead healthier and more productive lives," Dr. Greg Baxter, chief medical officer for the Granite Healthcare Network, said in a prepared statement.

The other organizations in the Granite Healthcare Network are Concord Hospital, Elliot Health System, LRGHealthcare and Southern New Hampshire Health System. Participating in the program are more than 900 health care professionals and more than 23,000 patients covered by a Cigna health plan

Cigna has similar initiatives under way in Connecticut and Maine, where Eastern Maine Healthcare Systems, Kennebec Region Health Alliance, Penobscot Community Healthcare are among the provider groups taking part.

Health care providers in New Hampshire are generally supportive of the ACO initiative, according to Paula Minnehan, the New Hampshire Hospital Association's vice president for finance and rural hospitals.

"The concept really makes a lot of sense — to coordinate the care," Minnehan said. "It is essential in order to transform health care moving forward, but I think everyone's moving cautiously and trying to kind of figure it out as they go."

Minnehan said challenges lie ahead in smoothly transitioning from a fee-for-service system to a proven ACO model. The different payers involved in the health care system are not all in alignment today about what a functioning ACO model should look like. It may also be easier for organizations with a large base of patients to work within an ACO framework, she said.

Regardless, Minnehan said it's apparent that a shift toward greater coordination of health care is inevitable.

"They are feeling the pressure," Minnehan said of the state's hospitals, "but they also are feeling the pressure within their own organizations. They know that it is not business as usual, and fee-for-service medicine is not the future of health care."